Compliance

VW Dealers Support Imperiled North America CEO

September 25, 2015
• by Staff

Volkswagen's North American dealers have thrown their support behind Michael Horn, the chief executive who has reportedly been fired amid a deepening scandal over the manipulation of diesel engine technology.

The scandal has "hit the dealers in the U.S. extremely hard," said Alan Brown, chairman of VW's National Dealer Advisory Council, in a statement obtained by F&I and Showroom's sister publication, Automotive Fleet.

"We have been suffering from an outdated product cycle, overpriced product, and a deteriorating relationship between the dealer body and Volkswagen for a number of years," Brown wrote. "That all changed when Michael Horn was made CEO of Volkswagen of North America in January of 2014."

Horn "tirelessly fought" for North American dealers to "correct the many missteps of prior management," Brown added.

Horn and two other executives will likely be fired today during the company's executive board meeting. Volkswagen AG's chief executive Martin Winterkorn resigned on Sept. 23. Ulrich Hackenberg, who oversaw Audi's research and development and Wolfgang Hatz, who was in charge of R&D for Porsche, are expected to lose their jobs, reports Reuters. Matthias Muller, now the Porsche chief executive, is expected to replace Winterkorn.

Winfried Vahland, who runs the company’s Skoda division, will likely take over for Horn, reported Bloomberg via Auto Bild magazine.

Brown said the removal of Horn would be "nothing short of catastrophic to our market and our relationship."

Pressure on Hyundai and Kia ramped up Monday with the launch of a multistate probe into fires involving the South Korean manufacturers’ Theta II engines and reports suggesting U.S. Sen. Richard Blumenthal will ask for a new investigation at the federal level.

Reagor Dykes Auto Group and Ford Motor Credit will begin mediation proceedings in Dallas Monday despite objections from Ford’s executives and attorneys, who have yet to approve a new proposal to resolve a $112 million floorplan financing dispute.